U.S. won’t offer federal fuel tax relief to truckers

WASHINGTON, D.C. (Feb. 24, 2000) — A spokesman for President Clinton says the administration is not in favor of temporarily rolling back federal taxes on diesel fuel to help truckers who have been hit with high diesel fuel prices. This news comes as some lawmakers in Washington are expected to introduce legislation that would give truckers some federal fuel tax relief and as fuel prices begin to slowly drop.

As more than 200 trucks rolled into Washington, DC, yesterday and independent truckers demonstrated over high fuel prices, White House Press Secretary Joe Lockhart said there is some evidence fuel prices are declining, and winter weather should soon be over, meaning there will be less demand for home heating oil. A sudden increase in the demand for home heating oil about a month ago, which caught suppliers unprepared, caused diesel prices to spike in the Northeast as inventories were diverted to the home heating oil market.

According to Lockhart, rolling back taxes on diesel fuel, as the independents are demanding, would be counter-productive because these tax proceeds are used to maintain highways, which are used by truckers.

Independent truckers aren’t the only ones asking the government for relief. American Trucking Associations president and CEO Walter McCormick Tuesday renewed the group’s call for emergency government action. McCormick will speak about the trucking industry’s concerns today before the U.S. Senate Committee on Energy and Natural Resources.

“A key reason trucking is the dominant mode of transportation in this country is because it is affordable,” McCormick said in a statement issued Tuesday. “And we are affordable because of razor-thin profit margins of 2% to 4%. … Most trucking companies can’t afford to absorb the diesel cost and don’t have the ability in a highly competitive market to raise prices to cover the diesel costs.”

The ATA is asking the government to open the Strategic Petroleum Reserve, convince OPEC that stable and reasonable prices are in everyone’s best interest, and to investigate any illegal price gouging.

There is some evidence that diesel fuel prices have leveled off and have even started to fall.

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